India: SteelMint's scrap index drops INR 400/t d-o-d on muted steel demand
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SteelMint's domestic steel scrap (end-cutting) index fell by INR 400/tonne (t) d-o-d to INR 37,600/t DAP Mandi Gobindgarh on 5 January, 2024.The scrap market experienced moderate demand, with mills continuing to acquire domestic scrap in the region. Imported scrap was deemed unfeasible in the current market scenario. Today, the availability of scrap is comparatively slower, reflecting weak market sentiments.
Steel market
Steel ingot prices in Mandi Gobindgarh dipped by INR 250/t to INR 43,200/t at the time of reporting and price normalisation. Prices in the majority of key markets decreased in a range of INR 100/t to INR 300/t, today. Rebar(Fe500) prices reamined unchanged d-o-d at INR 47,800/t ex-works.
The market experienced a subdued atmosphere today, with both the semi-finished and finished segments facing limited demand from buyers. Mills responded by extending discounted offers to their regular clientele. As the day progressed, the market eventually reached a standstill in the region. Despite the ongoing challenges, steel makers are hopeful about potential improvements in the near future.
Raw material prices
The prices of sponge iron (CDRI) saw a decrease of INR 100/t, settling at INR 32,000/t. Meanwhile, pig iron (steel grade) prices in Ludhiana remained stable at INR 40,300/t d-o-d.
Overview of other markets
On 5 January, 2024, ship-breaking melting scrap prices in Alang, Gujarat, remained unchanged day-on-day. According to SteelMint's evaluation, the prices for HMS (80:20) were reported at INR 35,000/t ex-yard. Despite a rise in semi-finished steel prices during the previous trading session, suppliers opted to maintain stable offers today due to moderate buying inquiries for scrap in the region.
The Jalna steel market observed moderate trade activities in finished steel. Semi-finished steel prices showed a slight increase by INR 100/t, reaching INR 43,200/t, whereas rebar prices remained stable at INR 49,000/t. In contrast, HMS 80:20 prices experienced a decline, dropping by INR 200/t to INR 33,800/t. Today's demand for finished steel decreased compared to the previous couple of days.
Price highlights
End-cutting-billets spread: In Mandi, the end-cutting scrap and billets spread stood at INR 5,500-6,000/t.
Domestic vs imported scrap: Imported melting scrap prices at Nhava Sheva Port were at around $390/t-$395/t, which equates to approximately INR 35,036/t (including freight). Meanwhile, in Mumbai, local scrap prices stood at INR 33,500/t, stable d-o-d.
In India, the demand for imported scrap continued to be subdued, primarily due to limited buying interest resulting from slow sales of finished steel in the domestic market and the substantial inventories maintained by mills. Indicative offers for shredded scrap from Europe were reported at $412-$415/t CFR Nhava Sheva.
Raipur sponge iron-billet spread: The current conversion spread (margin) from pellet-based DRI (P-DRI) to steel billets in Raipur stood at INR 13,150/t.
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